The birth of blockchain technology marked the first time in human history that verifiable decentralized systems could be created. However, this process has not been easy and is still evolving with many issues still to be adequately addressed. Hackings, country-wide bans, market manipulation, downtime – these are the most pressing issues to solve. Between the $730 million that has already been lost in 2018 to hacks of exchanges and 3rd party wallets and the bans on cryptocurrency exchanges across the planet, the act of safely trading cryptocurrencies is an uphill struggle for millions of people. Countries such as China, Jordan, India and many others have imposed strict banking regulation and bans on businesses that run centralized exchanges.
Security and access are the two biggest barriers to entry and are concerns for both traders and potential traders. If the crypto ecosystem is to achieve its original goal of decentralization and 100% trustlessness, then the issues of security and access must be solved. To address and fix these problems, Blocknet has developed and released Block DX.
Block DX is the first decentralized exchange (DEX) to offer “ultra-trustless” trading via a wallet (aka: node) you control. You run the wallets of the digital assets (tokens and coins) you want to trade on your own computer, meaning you never have to trust a 3rd party with your funds again! When you make a trade on Block DX, every transaction is between secure wallets you own. Whilst nobody can deny that centralized exchanges have gained a huge adoption from users, it’s very clear that this is still a young industry facing many issues. Centralized exchanges (CEX) have become popular because of their easy to use interfaces and the removal of individual user responsibility. However, this abdication of responsibility comes at a major price: Security. Centralized exchanges are very attractive to hackers and bad actors as they are often viewed as a weak point of critical failure in the crypto-economy. People are understandably very cautious with entrusting their funds to a third party whom they have no control over. What traders really desire is a secure and easy to use platform, where they can trade directly wallet-to-wallet, that is accessible in all countries without them having to trust a 3rd party with their funds. In other words, what’s required is the need for trust to be removed from the equation: a ‘trustless’ system.
For a DEX to be truly trustless, all 4 components must be completely decentralized and thus, 100% trustless. Many exchanges now use the term “decentralized” as a buzzword, with little understanding of what true decentralization really is. In fact, most of these exchanges are closer to being a “hybrid” exchange rather than a true DEX.
On Block DX:
- Deposits: Your funds always remain in your control throughout the whole trade process.
- Order broadcasting: Orders are broadcast directly from each trader and the order book is compiled locally instead of relying on a central order book service. This prevents front running and the opportunity for orders or the order book to be altered.
- Order matching: Orders are matched directly between traders. When one accepts another’s order, the exchange process automatically begins, and this is broadcasted over the inter-chain network.
- Settlement: There is no involvement of a third part or intermediary (unlike a centralized exchange) when a trade takes place. At the moment of the trade, an atomic swap automatically takes place (meaning that either the exchange of both currencies takes place, or nothing takes place), ensuring your digital assets are in your possession at all times and always under your control. This process exchanges the digital assets directly rather than relying on derivatives (proxy tokens or colored coins).
These 4 components represent the ultimate way to undertake decentralized trading in a 100% trustless manner from a wallet you control. No other DEX can offer this amount of control and security over your own wallet.
TRADING FOR ALL
Many people around the world are unable to access centralized exchanges because of government regulation and bans. However, individual users in these countries can still trade on Block DX because of the simple fact that Block DX is not run by a company, cannot be suddenly shut down by a government, and is completely decentralized in all its aspects. Block DX offers both SECURITY (inbuilt DOS protection and orderbook verification) and PRIVACY (no accounts or KYC (know your customer) required to trade). With over 100 tokens and 5000 trading pairs, a huge range of trade combinations are available and unlike other exchanges, listing a token on Block DX is completely FREE. With a quick and easy automated setup and a professionally designed UI that reflects a familiar trading experience, Block DX is naturally intuitive and very easy to use for both seasoned traders and complete novices. Additionally, Cloudchains, Inc. is currently implementing a fully decentralized lite (thin) multi-walletutilizing Blocknet’s XRouter protocol which means that you won’t have to download the blockchains to trade wallet-to-wallet!
You can view a short video tutorial that shows how to set up Block DX in less than 5 minutes and demonstrates a live trade that takes place in 10 seconds highlighting the speed of Block DX. Watch it here. To enter the world of “ultimate trustless trading”, learn more about Block DX and download it here. If you want to learn more, you can join the Blocknet Discord.
Originally published 20th March 2019 on Bitcoinist: